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Modernizing Ontario’s Mining Act (2 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

Overview of Ontario’s Mining Industry

The mineral sector is the largest private sector employer of Aboriginal workers in Canada.

Ontario is Canada’s largest producer of minerals, accounting for 28 per cent of the national total in 2007, at an approximate value of $10.7 billion. Exploration spending in Ontario has risen fourfold from $120 million in 2002 to $500 million in 2007. In 2008 that figure is expected to exceed $625 million.

Ontario is a leading producer in a number of base and precious metals. The province ranks among the top 10 global producers of platinum, nickel and cobalt and among the top 20 global producers of gold, silver, copper and zinc. Currently, there are 43 producing mines across Ontario: 28 metal mines; 14 major industrial mineral operations and Ontario’s first diamond mine.

The mining sector employs 100,000 Ontarians directly and indirectly. The average weekly earnings of the mining sector are 50 per cent higher than any of Ontario’s other industrial sectors. Mining companies inject approximately $1 billion annually into the Ontario economy and support over 1,000 local businesses.

Toronto is the international financial centre for the mining industry. This year, the Toronto Stock Exchange is listing more than 1,400 mining issuers at a market value of almost $380 billion. That’s more than half of the world’s public mining issuers and more than any other exchange in the world. Toronto is also home to around 400 mining and exploration companies and 260 other mining-related companies.

Ontario’s mineral development industry is a complex network of individuals (prospectors) and large and small companies often referred to as senior and junior companies respectively. Senior mining companies traditionally fund their exploration activities from revenues generated from the production of minerals and metals from their mining operations located around the globe. On the other hand, junior exploration companies predominantly fund their exploration projects by raising risk capital either through issuing treasury shares from stock exchanges around the world or with private placements from individual investors and investment groups. Junior companies often sell successful discoveries to senior companies for production. Combined, there are over 500 senior and junior mining and exploration companies currently active in Ontario.

Individual prospectors represent the start of the mineral development chain. There are over 6000 prospectors active in Ontario, representing the largest group in Ontario’s mineral development network. Prospectors can be independent, staking claims and exploring properties on their own, which they will in turn sell to junior exploration companies. Prospectors may also be employed by a junior company to prospect and stake claims on their behalf.